PrintJune 30, 2009
The GM Bankruptcy and the Supreme Court
Hearings on GM's motion to approve its restructuring plan are set to start today in Manhattan bankruptcy court. The heart of the individual bondholders' objections to the Obama Administration's plan to save GM is that it is a sub rosa and unconstitutional effort to do an end-run around the bankruptcy code and to enrich the coffers of the UAW, a key political ally of President Obama. In vacating its brief stay in the Chrysler case, the Supreme Court refused to address the merits of similar allegations, but limited its order to the facts at hand and arguably left open the possibility for a return trip with GM bondholders. A few individual GM bondholders make constitutional and statutory claims in objecting to the GM restructuring plan. An unofficial bondholders' committee which purports to represent more than 1,500 individual GM bondholders does not advance the constitutional issues and instead focuses on the plan's violation of the U.S. Bankruptcy...(Read Full Article)
